The Home You Saw Was a TIC. Now What?
TICs (Tenancy in Common) is a unique property type that originated in San Francisco. Let’s first explore the keys differences from condominiums and what makes TICs a great opportunity to own SF real estate.
There are FOUR mains ways TICs are different from condos:
T • T • L • R
OR IN OTHER WORDS:
TITLE • TAXES • LOAN • RENT CONTROL
Title - When you buy a TIC, you do not own the unit. Instead, you own a percentage of the building with other people who bought their respective TIC dwellings in the same building. Therefore, every owner’s name and their respective ownership appear on the title. The percentage you own varies—this can sometimes be determined by square footage, for example.
Taxes - Property taxes are paid monthly instead of biannually. The amount you pay depends on the percentage of the building you own.
Loan - If you seek financing for your purchase, you’ll have to obtain a fractional loan likely from the few local San Francisco lenders that offer this option. Fractional interest rates are different from conventional loans, and may sometimes be lower or higher.
Rent Control - Shall you ever decide to rent your property, all TICs are subject to rent control.
Frequently Asked Questions
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No. Prospective buyers used to secure group loans, often with strangers. These days, fractional loans are available, which means each owner has an individual mortgage.
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The city has strict rules governing condo conversion, but currently there are options for buildings with four units or fewer. Click here to find out more about eligibility.
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This is a common question we hear at open houses. The answer is no. A TIC lives and feels like a condo, and every owner is free to sell when he or she pleases, just like a condo.
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TICs are typically 10%-20% lower than market rate. This is largely due to perception, but this may not even matter to you. Prices also tend to reflect how easy (or impossible) it is to condo convert.
Watch Our Video About TICs + a TIC Property Tour